'No new models in 2022': Wall Street analysts react as Tesla's 4th-quarter earnings spark 7% drop in stock price
- Tesla fell 8% on Thursday after it reported fourth-quarter earnings that beat analyst estimates.
- Investors were likely disappointed by product delays for Tesla's Cybertruck and Semi-truck.
- Here's how three Wall Street analysts reacted to Tesla's fourth-quarter earnings report.
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Tesla stock fell as much as 8% on Thursday after its fourth-quarter earnings call revealed several product delays for its Cybertruck, Semi-truck, and Roadster.
The company's results were ahead of analyst expectations, and Tesla said it expects to continue growing annually at a pace of at least 50%.
Here were the key numbers:
Revenue: $17.7 billion, versus analyst estimates of $16.6 billion
Adjusted earnings per share: $2.54, versus analyst estimates of $2.38
Automotive gross margin: 30.6%, versus 30.5% in the prior quarter
While Tesla beat estimates and expects the growth to continue, CEO Elon Musk said on the earnings call that the company will likely be facing supply chain issues through the end of 2022. The main driver is a shortage of semiconductors, which Tesla heavily relies on.
That shortage and the continued strong demand for Tesla's Model 3 and Y vehicles led the company to announce that its Cybertruck, Roadster, and Semi-truck won't launch in 2022. Additionally, Tesla said it is not currently working on a lower-cost $25,000 electric vehicle.
Finally, the EV maker talked up the potential of its human robot that is under development, dubbed "Optimus." Musk said the friendly version of R2-D2 has the potential to one day be a bigger business than its automotive division.
Here's how three Wall Street analysts reacted to Tesla's fourth-quarter earnings report.
JPMorgan: "No new models in 2022 as Cybertruck and Semi delayed again."
JPMorgan raised its price target to $325 from $295 and reiterated its "Underweight" rating.
"While Tesla's product development roadmap may have disappointed customers having placed deposits for their Roadsters as far back as 2017 and their Cybertrucks as far back as 2019, there is no denying Tesla delivered for investors in 4Q," JPMorgan said.
The bank highlighted that Tesla's focus on a human robot and delays of its Cybertruck come as competition in the electric pickup truck space heats up with Rivian, Ford, and General Motors.
Wedbush: "Tesla delivers another stellar quarter."
Wedbush reiterated its $1,400 price target and "Outperform" rating.
"The narrative and fundamental story for Tesla is more bullish this morning after the call/quarter than 24 hours ago. The Austin production news and 4680 [battery] update are potential 'game changers' to the Tesla story especially in this supply constrained backdrop. In a nutshell, Tesla is extending their lead in the EV arms race and once Austin and Berlin are fully ramped over the coming months the expanded production capacity will be a linchpin to meeting the growing Tesla demand trajectory in 2022 and beyond," Wedbush said.
Goldman Sachs: "Strong revenue and profit growth continues."
Goldman reiterated its $1,200 price target and "Buy" rating."
"While the delay to the Cybertruck was widely reported on already, the info on the $25K vehicle progress could raise questions on growth in the 2023-2025 timeframe given the large number of vehicles sold in this price band. However, we see significant growth ahead with its current models, including as the company drives down cost."
"Moreover, profits on entry-level vehicles for the entire auto industry have typically been limited, and thus the company's decision to devote its resources first to high-value software and more profitable hardware is reasonable in our view," Goldman said.
